Barclays deal with Qatar was ‘dodgy’. Court hears bankers admit to worries over fees. Senior Barclays (BARC) executives spoke of being “rumbled” over a plan to pay Qatari investors millions of pounds in secret fees and expressed surprise that their boss had agreed to the deal. Richard Boath, a senior Barclays investment banker, joked that he could avoid any criminal retribution because he had a house in Brazil, where there was no extradition treaty with Britain, while he and Roger Jenkins, who was head of Barclays in the Middle East, said that the arrangement with Qatar was “a bit dodgy”. The comments were made in telephone calls played for a jury at Southwark crown court yesterday in the third day of a criminal trial brought by the Serious Fraud Office against four former Barclays bosses over payments to Qatar during the financial crisis. John Varley, 62, former chief executive and Tom Kalaris, 63, head of wealth management, are charged along with Mr Jenkins, 63, and Mr Boath, 60, with fraud over capital-raisings in 2008, when Barclays sought private investors to shore up its balance sheet so that it could avoid a government bailout.
Fuller, Smith & Turner loses its Pride as it sells to Japanese. Fuller Smith & Turner (FSTA) is quitting the brewing business after 174 years with the surprise £250 million sale of its beer business, including London Pride and its historic Griffin Brewery in west London. The deal with Asahi, the giant Japanese drinks group, also includes the Frontier beer brand, Cornish Orchards cider and Dark Star, a craft brewery in West Sussex. Fuller’s was founded in 1845 by John Bird Fuller, Henry Smith and John Turner and the families still speak for about 50% of the shares and 75% of the votes. Four years ago, Simon Emeny, chief executive, told The Times that the beer business was “the heart and soul” of the business, and added: “In many ways it defines what we do and makes us the special company we are.”
Grant Thornton loses audit contract with Brighton Pier Group (The) (PIER). The audit firm under regulatory investigation for the accounting irregularities at Patisserie Holdings is being replaced as auditor of another public company also backed by Luke Johnson, the entrepreneur. Grant Thornton, whose audit of the collapsed café chain is being scrutinised by the Financial Reporting Council, is also the auditor of Brighton Pier Group, where Mr Johnson is the biggest shareholder. Contacted yesterday by The Times over the connection, Anne Ackord, chief executive of Brighton Pier Group, said that it had started a tender process a couple of months ago and had decided to replace Grant Thornton with BDO, another firm.
Tesco boss sues over dismissal. The former boss of Tesco’s British business is pursuing an unfair dismissal claim against the supermarket group after he was cleared of false accounting and fraud. Chris Bush had worked at Tesco (TSCO) for 32 years before he was sacked for gross misconduct in 2014 and linked to an alleged £250 million accounting fraud. He was charged by the Serious Fraud Office, but the case was thrown out last month after a judge ruled that the crime agency had no case. Clive Howard, an employment solicitor from Slater and Gordon, said yesterday: “We can confirm that Chris Bush issued an employment claim against Tesco for unfair dismissal in April 2015. This was put on hold pending the criminal proceedings. Now, with the criminal proceedings all thrown out, the tribunal claim has recommenced. Mr Bush will be making no comment at this time.” Carl Rogberg, the UK former finance boss at Tesco, also filed an unfair dismissal claim, which was stayed during the proceedings. It is thought that Mr Rogberg, who was cleared of fraud and false accounting this week, has not yet decided on whether to pursue the case.
Bleak midwinter at Bonmarché. Sales have fallen sharply again at Bonmarche Holdings (BON), but its shares still edged up yesterday as the City took comfort that trading had not deteriorated further after a profit warning last month. The over-50s women’s fashion retailer said that like-for-like sales had dropped by 7.8% in the 13 weeks to December 29, driven by a 11.1% fall in comparable store sales. In the year so far, like-for-like sales are down 3.3%. After an early surge, the shares closed a penny, or 2.7%, up at 38p. In December it lost as much as half of its market value in a day after warning that it could fall into the red in the wake of a spell of trading that it described as “unprecedented” and “significantly” more severe than during the last recession.
Industry giants flash plastic for Earthport. Mastercard has gatecrashed an agreed takeover of a British payment processing minnow by Visa, announcing its own £233 million deal yesterday. Mastercard’s offer of 33p per share in cash for Earthport (EPO) trumped Visa’s previous 30p bid, which was agreed a month ago and valued the company at £198 million. Earthport, which had agreed the Visa deal, withdrew its recommendation and instead urged shareholders to accept the proposal by Mastercard. The arrival of Mastercard raises the possibility of a bidding war between the two giants of payment processing. Shares in Earthport, a company seen as having innovative and promising technology, leapt by 8¾p, or 31%, to 36½p yesterday.
Brexit fears blowing us off course, says Fairfx Group (FFX). The travel money and payments company FairFX has warned that Britain’s looming exit from the European Union has hit its business, even as it announced a surge in revenues. Turnover more than doubled to £2.36 billion last year, boosted by acquisitions, while adjusted earnings before interest, taxes and other charges is forecast to have jumped to about £7.5 million from £1 million in 2017, the company said in a trading update. However, its shares slumped by 8¾p yesterday to close at 98¼p after it said that a plan to overhaul its supply chain and improve margins in its corporate card business had fallen behind schedule and that despite the surge in revenues and profits, the pound’s weakness amid Brexit worries had dented customer sentiment and activity.
Rentokil to shed supply contracts after merger. One of Britain’s biggest suppliers of hand dryers and soap dispensers in public toilets has been ordered to sell contracts amid concerns that its takeover of a smaller rival harms competition. The Competition and Markets Authority ruled that Rentokil Initial (RTO) must offload several contracts to service washrooms at offices and restaurants in the wake of its acquisition of Cannon Hygiene last year. Rentokil Initial, which is also the world’s biggest pest control firm, traces its roots back to the 1920s, when Harold Maxwell-Lefroy, a professor of entomology at Imperial College London, was asked to find ways of killing beetles infesting Westminster Hall. In 1925 he founded Rentokil, but then accidentally poisoned himself “while experimenting with gases fatal to insects”. The company grew into a FTSE 100 giant with 36,000 employees in more than 70 countries.
Vodafone hits the pause button on supplies of Huawei’s kit in Europe. Vodafone Group (VOD) has halted the purchase of Huawei equipment for parts of its network amid political uncertainty surrounding the Chinese supplier. Nick Read, chief executive of the British telecoms group, said yesterday that it had “paused” the deployment of Huawei equipment in its core networks in Europe, the part of the system that is deemed most sensitive. Mobile operators are facing scrutiny over their links to Huawei because of concerns about security risks, particularly within the United States, the trade war between America and China and the arrest of a Huawei executive in Canada last month. The decision comes after BT said last month that it would not use the Chinese supplier in its core networks for its new 5G service.
AG Barr still fizzing but wary of the bubble bursting. The maker of Irn Bru remains cautious about the impact of a weaker economy and further regulation on the soft drinks industry, but is on course nonetheless to increase its annual revenue by 5%. Roger White, chief executive of Barr (A.G.) (BAG), said that after a strong summer there were seen signs of lower consumer spending that had affected the group’s grocery and casual dining customers in the autumn. Trading, however, had improved towards Christmas and in the early weeks of this year, leading the company to expect sales by volume and value to have grown by 3% and 8%, respectively, in the 52 weeks to January 26. Revenue for the financial year is forecast to be about £277 million, up from £264.1 million the previous year.
IQE suffers as iPhone sales slump. A British semiconductor maker and supplier to Apple has warned of a sharp drop in its annual profits amid weak sales of the iPhone and a slowdown in China. The Cardiff-based IQE (IQE) said that it expected to deliver underlying profits of “at least” £27.5 million for last year, down from £37.0 million in 2017 and short of City analysts’ forecasts. The gloomy prognosis comes after a profit warning in November, when IQE warned that a “major customer” had reduced its orders. IQE is a leading maker of wafers, one of the building blocks of semiconductors. Chips using its technology are found in the 3D-sensing camera of the iPhone X.
A downgrade from Jefferies put Fevertree Drinks (FEVR) on ice as the broker brought old worries about the posh tonic maker’s punchy valuation back into focus. Fevertree had dismissed scepticism about its growth prospects on Thursday as it predicted that full-year results would be “comfortably ahead of the board’s expectations”, sending its shares up 13.5%. Jefferies, however, was not sold on the management’s optimism. Its analysts downgraded the stock to “hold” from “buy” yesterday, saying that they expected growth in Britain to moderate before it advanced in the United States. A 5% slowdown in the British market would require a 20% acceleration in America. the analysts said.
Midatech Pharma (MTPH), a cancer specialist in which Neil Woodford’s Woodford Investment Management owns 20%, tumbled after it said that it was urgently trying to close a deal with a strategic investor as the company had very little cash.
